EDITORIAL – A necessary alliance

If anyone doubted the symbiotic relationship which must exist between a government and the business community in the development of a country governed under democratic principles, then the recent discussions on the economy in the electronic and print media ought to be an eye opener. That such a relationship has to exist is not proof of what one politician called “an unholy alliance” when he was on the hustings. Rather, it is an alliance built out of the necessity of good governance which is prescribed by the Constitution.The fate and state of certain local companies, for example, is as good an indication as any that when things are not economically well, some employees may have to go. This may be one of the more drastic signs and consequences of a downturn, but even before this; reduced traffic in and out of the stores and other businesses may have been the order of the day, with the further consequence that smaller levels of taxes become payable thereby leading to reduced government revenues.In the course of the past week’s discussion this matter of reduced revenues emerged as one of the more intractable problems facing the Government, for it appears that current revenues are not matching the increasing levels of current expenditure, and this is happening during a recession in which business activity and profitability is reduced. Of course some may say it is easy to cut expenditure and raise revenue and while this may be part of a solution, it cannot be all the solution, because the responsibilities of the Government is to ensure so far as possible that there is a safety net, (financed by taxes), in the form of unemployment benefits, welfare payments, affordable bus fares and reasonable rents for government housing, among others, if a cohesive society is to be maintained and enhanced. Last week too, a new branch of the Barbados National Bank opened its doors at the Limegrove Lifestyle Centre, in Holetown, and the sentiments expressed at this function underlined the importance of the “partnership” between government and business.Managing director of the bank, Mr Robert Le Hunte, justified  the bank’s financing of corporate initiatives such as Limegrove on the basis that not only are they economically viable, but because “they are useful and essential to the continued success of Barbados”.Although it was not said, the success of the enterprises which will inhabit the centre, and the centre itself will contribute to the national treasury through the payment of income taxes, corporate taxes and the value added tax; and increased employment will result.We need hardly stress that this project, and the Four Seasons project are private sector projects, nor do we need to emphasise that they are both likely to generate recurring inflows of foreign exchange, to the benefit of the Government’s coffers and to the stability  of our foreign reserves. We commend and support the philosophy of the Government becoming an efficient facilitator and thereby ensuring the most efficient and timely delivery of its services, so that businessmen, local and foreign alike can make such investments as will enhance the public good. The cost of government cannot be allowed to grow without check, and improved efficiency may be one of the best ways of reducing costs, and maintaining a tax system which is attractive and sufficient.The way forward will therefore mean engendering a more sensitive appreciation of the role of properly regulated business enterprise, which must be energised to perform an enhanced function of making profits and providing revenue and employment, while earning foreign exchange from an export driven philosophy.  And all this facilitated by a Government truly cognizant of the role of business as a partner in governance!